Independent Health is closely following efforts by the Trump Administration and Congress to repeal and replace the Affordable Care Act (ACA), a process that involves a three-pronged approach: reconciliation legislation through the proposed American Health Care Act; administrative action, and additional legislation outside of the reconciliation bill.

We provide this latest overview in our occasional series of ACA updates.

May 4, 2017 Update:
The House passes its American Health Care Act

american flag with stethoscope in foreground

Congress made an incremental step toward repealing the Affordable Care Act (ACA) on Thursday, May 4, by passing an amended version of the American Health Care Act (AHCA) by a margin of 217 votes to 213. The next step in the legislative process sends the AHCA to the Senate, where the bill is expected to undergo changes.

Some of the AHCA key provisions include:

  • Repeal of the individual and employer mandates;
  • Elimination of most of the ACA taxes; and,
  • Changes to the level of tax credits and subsidies for individuals.

An earlier attempt by the House to vote on a previous version of the AHCA was canceled in March after House leaders determined then they didn’t have enough votes. Two amendments were later added to the AHCA which enabled the House to approve this version:

1. The MacArthur Amendment would give states the option to opt-out of certain ACA provisions, by allowing states to apply for specific waivers to:

  • Increase the state’s age band ratio, which would decrease premiums for younger people, but increase premiums on older people;
  • Specify its own Essential Health Benefits package for individual or small group markets;
  • Permit the state to vary premiums by health status for policyholders who do not maintain continuous coverage.

The MacArthur Amendment requires a state applying for a waiver to the Dept. of Health and Human Services to specify how the state would accomplish one or more of the following:

  • Reduction of average premiums for health insurance in the state;
  • Increase in enrollment in coverage;
  • Stabilization of the market for health insurance coverage;
  • Stabilization of premiums for individuals with pre-existing conditions;
  • Increase in the choice of health plans.

It is unlikely New York will apply for a waiver in the bill’s current form.

2. An amendment by Rep. Upton (R-Utah) adds $8 billion over five years to fund the cost of providing coverage to people with pre-existing conditions.

Next Steps
There is still a long road toward full ACA repeal and the future of AHCA is unclear, as it will face both substantive and procedural obstacles in the Senate. The Senate Finance Committee and the Health, Education, Labor and Pension Committee will lead the effort in the Senate in evaluating the bill and possibly making revisions. Any changes in the Senate to the AHCA would send the bill back to the House for a new vote.

Cost Sharing Reductions
The House-approved ACHA does not address the Cost Share Reductions (CSRs), which help offset the copayments, coinsurance, and deductibles for individuals who qualify for financial assistance. The elimination of CSRs would impact many individuals’ ability to afford coverage, and may significantly affect New York State’s Essential Plan offerings available to people whose incomes fall above Medicaid limits.